From the East, globally

In Shanghai for Advantech’s third World Partner Conference, Control Engineering Asia group editor Bob Gill finds an ambitious Eastern company ready to take globalization to the next level. Oh, East is East, and West is West, and never the twain shall meet.” These words, written over 100 years ago during the high noon of Britain’s colonial empire by Rudyard Kipling, are still t...

In Shanghai for Advantech’s third World Partner Conference , Control Engineering Asia group editor Bob Gill finds an ambitious Eastern company ready to take globalization to the next level.

Oh, East is East, and West is West, and never the twain shall meet.” These words, written over 100 years ago during the high noon of Britain’s colonial empire by Rudyard Kipling, are still taken out and quoted as evidence of a large socioeconomic and cultural distance between Asia and Europe/America. But while that sentiment may have been true in Kipling’s time, it is increasingly less so.

With the singular exception of Japan, for many years the flow of technology and capital was West to East, enabling many countries in Southeast Asia and then China to pull themselves up by becoming workshops for the big European and U.S. multinationals. But a much more recent and seemingly accelerating trend is the reverse flow from nontraditional sources in Asia: India’s Tata Group, for instance, striding the globe and shelling out billions on European steelmaker Corus.

In the automation arena, one Asian company that is now playing on the global stage is Taiwan’s Advantech. Its recent World Partner Conference saw an impressive array of delegate nationalities flying in to Shanghai. Advantech’s professed aim is to become a globally integrated enterprise (GIE). In a GIE, traditional concepts of home country, foreign offices, and geographical domains, transform into a single globally integrated identity with work flowing to where it is done best.

Chaney Ho, Advantech’s general manager for greater China, said, “Information, money, talent—these can be moved around the world freely. And the Internet revolution, telecommunications, and transportation represent driving forces toward One World.” Advantech solutions are already being harnessed around the world, he said: in a wind power generation monitoring system in Germany, a continuous emissions monitoring system in China, and an airport security control system in Australia, to name just a few.

In just under 25 years, Advantech has expanded far beyond the confines of Taiwan, where it was first established by ex Hewlett-Packard engineer KC Liu. North America and Europe together contributed 50% of 2006 sales (US$452 million); Greater China, 27%; and the balance is almost evenly split among Japan/Korea, South Asia Pacific, emerging territories, and others. Product manufacturing is concentrated in Asia at three centers: Taipei, Kunshan, and Dongguan, and the company operates four regional logistics centers in California, Eindhoven, Taipei and Kunshan.

I asked David Soon, head of the Advantech South Asia Pacific business unit, what he saw as key growth sectors for Advantech. “In South Asia Pacific, our traditional sectors like industrial automation are still expanding, although steadily rather than spectacularly.” Thus, he said, there is a need to get into new areas that have higher growth potential.

“Rising expectations for comfort, mobility, information, instant gratification, create opportunities for technology such as digital signage in retail stores, and for service-oriented solutions, which can be enabled by M2M [machine to machine] connectivity,” Soon said. “And the medical sector is one where infocomm technology is making a big impact, such as with tele-radiology, and one where Advantech is very active. Also, as you can see here in Shanghai, we are already showcasing solutions for non-traditional sectors like gaming and home automation.”

Defining the GIE push as the fourth stage of Advantech’s evolution (from a local Taiwan company, to an export company, and then to today’s multinational), Liu expects Advantech’s transformation to be completed within three years.

To read Gill’s complete special report on Advantech, visit www.ceasiamag.com . Control Engineering Asia covers the world of automation and instrumentation, in English, from a Southeast Asian perspective.